ABSTRACT Skin morphogenesis and homeostasis requires the assembly of diverse cells from different embryonic origins. This poses an engineering challenge for building complex and easily assembled skin in vitro, which could be used for cell therapy for burns and wounds. The specific problem is that cells commonly used to derive skin in vitro lack the potency to generate skin appendages, such as hair follicles and sweat glands, as well as accessory cells, such as melanocytes and adipocytes. Identification of the key cell signaling mechanisms needed to differentiate appendage-bearing skin from progenitor cells, such as human pluripotent stem cells (hPSCs), or to stimulate skin appendage induction from adult skin cells is a critical barrier to progress. Epidermal cells can be efficiently generated in vitro from hPSCs; however, it is unclear how to regulate the induction of dermal progenitor cells. Therefore, our long-term goal is to define the chemical and physical signals required to recapitulate development of human skin progenitor cells to reconstitute complex skin. Our project builds on preliminary data demonstrating a novel multi-stage 3D culture system that uses hPSCs to generate full-thickness skin containing most of the primary and specialized cellular components of normal skin, including hair follicles and sensory nerves. In the culture system, we modulate signaling pathways to co-induce surface ectoderm and cranial neural crest cells?two cell types critical for facial skin development. In Aim 1, we will use single-cell RNA-sequencing and drug treatments to test the hypothesis that FGF-WNT-TGF signaling dynamics underlie diversification of the cranial neural crest cell population containing dermal, chondral, neural, and glia progenitor cells. These experiments will allow us to better control the types of cells that develop in skin organoids. In Aim 2, we will test the hypothesis that skin organoid formation is independent of dermal cell lineage and is generalizable to other anatomical locations. We will use directed differentiation of mesoderm- derived dermal cells and micro-well organoid reconstitution for these experiments. We expect that these studies will lead to new ways to create site-specific skin grafts. Finally, in Aim 3, we will test the hypothesis that individual skin organoids can be combined to form multi-organoid grafts in a xenograft mouse model. These experiments will provide proof-of-principle evidence that skin organoids could be used for skin reconstructive surgery. Considering that the human embryo is largely inaccessible for scientific analysis, our organoid system will provide an unprecedented window into the earliest stages of human development for researchers studying skin organogenesis. In addition, our efforts could lead to novel cell therapies for skin wound healing.